On August 2, 2024 bluebird bio, Inc. (Nasdaq: BLUE) reported that the Compensation Committee of the Company’s Board of Directors approved an inducement grant of stock options to purchase a total of 38,200 shares of common stock to its controller and vice president of accounting, Joe Ewer, with a grant date of August 1, 2024 (Press release, bluebird bio, AUG 2, 2024, View Source [SID1234645313]).

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The stock options approved under the Inducement Plan have an exercise price per share equal to $1.08, the fair market value of the Company’s common stock on the grant date. The stock options vest over four years, with 25% vesting on the one-year anniversary of the grant date and 1/36 of the remaining shares vesting monthly thereafter, subject to Mr. Ewer’s continued service with the Company on each such date. The stock options have a 10-year term and are subject to the terms and conditions of the stock option agreement.

The Company granted the stock options as inducement materials to Joe Ewer entering into employment with bluebird bio, Inc. in accordance with NASDAQ Listing Rule 5635(c)(4).

On August 1, 2024 Aurinia Pharmaceuticals Inc. (NASDAQ: AUPH) (Aurinia or the Company) reported its financial results for the second quarter and six months ended June 30, 2024 (Press release, Aurinia Pharmaceuticals, AUG 1, 2024, View Source [SID1234645247]). Amounts are expressed in U.S. dollars.

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Total net revenue was $57.2 million for the three months ended June 30, 2024, and $41.5 million for the same period in 2023, representing growth of approximately 38%. Year to date total net revenue was $107.5 million for the six months ended June 30, 2024, compared to $75.9 million for the same period in 2023, representing growth of approximately 42%.

Net product revenue was $55.0 million for the three months ended June 30, 2024, and $41.1 million for the same period in 2023, representing growth of approximately 34%. Net product revenue was $103.1 million for the six months ended June 30, 2024, and $75.4 million for the same period in 2023, representing growth of approximately 37%. Net product revenue in the second quarter included sales of semi-finished product to Otsuka Pharmaceutical Co., Ltd. (Otsuka) for distribution in Europe and in anticipation of product approval in Japan.

"Our quarter-over-quarter growth in the second quarter is a result of our continued focus on commercial execution and business fundamentals. We are well prepared as we exit the first half of 2024, with upcoming innovative commercial initiatives targeting rheumatologists, the advancement of our AUR200 pipeline asset, and the anticipated approval of LUPKYNIS in Japan. Additionally, achieving positive free cash flow ahead of our initial projections further strengthens our financial position and allows more flexibility to explore opportunities to diversify our portfolio," said Peter Greenleaf, President and Chief Executive Officer of Aurinia.

The Company anticipates Japanese regulatory authorities’ approval of LUPKYNIS in the second half of this year, based on the JNDA that Otsuka filed in November 2023 for approval of LUPKYNIS to treat adults with LN. Upon approval, the Company expects to receive a milestone payment of $10 million with low double-digit royalties on net sales once launched.

Additionally, the Company is moving forward with development of its pipeline asset AUR200, a differentiated, potential next generation therapy for autoimmune diseases that targets both BAFF (B-cell Activating Factor) and APRIL (A Proliferation-Inducing Ligand).

"We are thrilled to advance AUR200, which has the potential to serve as a best-in-class treatment in disease areas with high unmet need. We intend to develop it in disease states where there are currently few market entrants, including exploring one larger indication and one fast-to-market smaller indication that meets the FDA criteria for orphan and rare diseases," said Dr. Greg Keenan, Chief Medical Officer of Aurinia.

First patients are expected to enter the Phase 1 Single Ascending Dose (SAD) study of AUR200 in the third quarter of 2024. Data from the SAD study, including safety, tolerability, pharmacokinetics, and biomarkers, is anticipated in the first half of 2025. The Company anticipates funding this development program with available cash flow, which is not anticipated to impact previously announced post restructuring operating expense targets. As previously reported, the Company expects to recognize $50 to $55 million in annual cost savings following the restructuring, with approximately 75% of that recognized in 2024.

For the fiscal year 2024, the Company is narrowing its net product revenue guidance range to $210 to $220 million, from the previously established range of $200 to $220 million. The guidance range is based on assumptions regarding historical run rates for patient start forms (PSF), patients restarting therapy, hospital fills, conversion rates, time to convert, persistency, and pricing.

Second Quarter 2024 Highlights

In the second quarter of 2024 the Company:

Achieved 22% growth in patients on LUPKYNIS therapy, with approximately 2,336 patients on therapy as of June 30, 2024, compared to 1,911 as of June 30, 2023.
Added 428 PSFs and approximately 127 new patients who were either restarting LUPKYNIS or receiving it through a hospital pharmacy in the second quarter, compared to 451 PSFs in the prior year second quarter.
Added approximately 538 PSFs and approximately 155 new patients from restarts and the hospital channel from April 1, 2024, through July 31, 2024.
Sustained conversion rates, with approximately 85% of PSFs converted to patients on therapy.
Sustained time to convert, with approximately 60% of patients on therapy by 20 days.
Maintained high overall adherence rate at approximately 88%.
Continued strong persistency, with approximately 56% of patients remaining on therapy at 12 months, 51% at 15 months, and 46% at 18 months.
Financial Results for the Three and Six Months Ended June 30, 2024

Total net revenue was $57.2 million and $41.5 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Total net revenue was $107.5 million and $75.9 million for the six months ended June 30, 2024 and June 30, 2023, respectively.

Net product revenue was $55.0 million and $41.1 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Net product revenue was $103.1 million and $75.4 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The increase is primarily due to an increase in sales of LUPKYNIS to the Company’s two main specialty pharmacies, driven predominantly by further penetration of the LN market. Additionally, Aurinia had sales of semi-finished product to Otsuka as Otsuka continues to commercialize in its territories.

The U.S. penetration can be demonstrated by a total of approximately 2,336 patients on therapy as of June 30, 2024, compared to approximately 1,911 patients on therapy as of June 30, 2023. Additionally, the 12-month persistency rate has increased to 56% at June 30, 2024 from approximately 54% at June 30, 2023.

License, collaboration and royalty revenue was $2.2 million and $0.4 million for the three months ended June 30, 2024 and June 30, 2023, respectively. License, collaboration and royalty revenue was $4.4 million and $0.5 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The increase is primarily due to manufacturing services revenue from Otsuka related to shared capacity services that commenced in late June 2023.

Total cost of sales and operating expenses, inclusive of a restructuring charge in the second quarter of 2024, were $58.7 million and $57.7 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Total cost of sales and operating expenses inclusive of a restructuring charge were $122.3 million and $121.7 million for the six months ended June 30, 2024 and June 30, 2023, respectively. Further breakdown of cost of sales and operating expense drivers and fluctuations are highlighted in the following paragraphs.

Cost of sales were $8.9 million and $1.6 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Cost of sales were $16.7 million and $2.0 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The increase is primarily due to the amortization of the monoplant finance right of use asset, which was placed into service in late June 2023, semi-finished product sales to Otsuka and increased sales of LUPKYNIS (voclosporin).

Gross margin was approximately 84% and 96% for the three months ended June 30, 2024 and June 30, 2023, respectively. Gross margin was approximately 85% and 97% for the six months ended June 30, 2024 and June 30, 2023, respectively.

SG&A expenses, inclusive of share-based compensation, were $44.9 million and $47.1 million for the three months ended June 30, 2024 and June 30, 2023, respectively. SG&A expenses, inclusive of share-based compensation, were $92.6 million and $97.2 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The decrease is primarily due to lower employee and overhead costs as a result of a reduction in general and administrative headcount, which occurred late in the first quarter of 2024 partially offset by an increase in legal fees.

Non-cash SG&A share-based compensation expense included within SG&A expenses was $8.1 million and $9.8 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Non-cash SG&A share-based compensation expense included within SG&A expenses was $15.6 million and $17.4 million for the six months ended June 30, 2024 and June 30, 2023, respectively.

R&D expenses, inclusive of share-based compensation expense, were $4.1 million and $12.7 million for the three months ended June 30, 2024 and June 30, 2023, respectively. R&D expenses, inclusive of share-based compensation expense, were $9.6 million and $25.8 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The primary drivers for the decrease were lower employee costs due to a reduction in headcount, which occurred late in the first quarter of 2024, a decrease of CRO and developmental expenses related to ceasing development of Aurinia’s AUR300 program and timing of expenses related to AUR200.

Non-cash R&D share-based compensation expense included within R&D expense was $0.1 million and $2.1 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Non-cash R&D share-based compensation expense included within R&D expense was $(2.1) million and $3.7 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The non-cash R&D share-based compensation credit in the six months ended June 30, 2024 is due to the reversals of expense for forfeitures related to a reduction in headcount in the first quarter of 2024.

Restructuring expenses were approximately $1.1 million and nil for the three months ended June 30, 2024 and June 30, 2023, respectively. Restructuring expenses were approximately $7.8 million and nil for the six months ended June 30, 2024 and June 30, 2023, respectively. Restructuring expenses primarily included employee severance, one-time benefit payments and contract termination expenses.

Other income, net was $0.3 million and $3.6 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Other income, net was $4.4 million and $3.3 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The change is primarily driven by changes in the fair value assumptions related to Aurinia’s deferred compensation liability and the foreign exchange remeasurement of the monoplant lease liability, which commenced in June 2023 and is denominated in CHF.

Interest income was $4.2 million and $4.1 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Interest income was $8.7 million and $7.9 million for the six months ended June 30, 2024 and June 30, 2023, respectively.

Interest expense was $1.2 million and $0.1 million for the three months ended June 30, 2024 and June 30, 2023, respectively. Interest expense was $2.5 million and $0.1 million for the six months ended June 30, 2024 and June 30, 2023, respectively. The interest expense is due to the monoplant finance lease, which commenced in June 2023.

For the three months ended June 30, 2024, Aurinia recorded net income of $0.7 million or $0.01 net income per common share, as compared to a net loss of $11.5 million or $(0.08) net loss per common share for the three months ended June 30, 2023. For the six months ended June 30, 2024, Aurinia recorded a net loss of $10.0 million or $(0.07) net loss per common share, as compared to a net loss of $37.7 million or $(0.26) net loss per common share for the three months ended June 30, 2023.

Financial Liquidity at June 30, 2024

As of June 30, 2024, Aurinia had cash, cash equivalents, restricted cash and investments of $330.7 million compared to $350.7 million at December 31, 2023. The decrease is primarily related to the continued investment in commercialization activities and post approval commitments of our approved drug, LUPKYNIS, monoplant payments, share repurchases and restructuring related payments, partially offset by an increase in cash receipts from sales of LUPKYNIS and cash payments from Otsuka.

Cash generated from operations and non-GAAP free cash flow generated were $15.8 million for the three months ended June 30, 2024 compared to cash used in operations of $2.8 million and non-GAAP free cash flow used of $3.0 million for the three months ended June 30, 2023. Cash used in operations and non-GAAP free cash flow used were $2.8 million for the six months ended June 30, 2024 compared to cash used in operations of $34.5 million and non-GAAP free cash flow used of $35.0 million for the six months ended June 30, 2023.

Free cash flow is a non-GAAP financial measure calculated by subtracting purchases of property and equipment from net cash provided by or used in operating activities. Free cash flow reflects a view of Aurinia’s liquidity that, when viewed with the Company’s GAAP results, provides a more complete understanding of factors and trends affecting Aurinia’s cash flows. The Company believes it is a more conservative measure of cash flow since capital expenditures are necessary for ongoing operations. Free cash flow has limitations due to the fact that it does not represent the residual cash flow available for discretionary expenditures. For example, free cash flow does not incorporate the principal portion of payments made or expected to be made on finance lease obligations. Therefore, the Company believes it is important to view free cash flow as a complement to its entire consolidated statements of cash flows.

A reconciliation of free cash flow to its most directly comparable GAAP measure, net cash provided by or used in operating activities, is set out in the Condensed Consolidated Statement of Cash Flows included at the end of this press release.

Share Repurchase Program

As previously announced, Aurinia’s Board of Directors approved a share repurchase program of up to $150 million common shares of the Company. Canadian securities regulators also granted exemptive relief for the Company’s share repurchase program, authorizing the Company to purchase up to 15 percent of its issued and outstanding shares in any 12-month period for up to 36 months. Through July 31, 2024 Aurinia has repurchased 3.4 million shares for approximately $18.6 million at an average cost of $5.36. The Company expects to fund any future discretionary share repurchases from cash flows from operations and cash currently on hand.

This press release is intended to be read in conjunction with the Company’s unaudited condensed consolidated financial statements and Management’s Discussion and Analysis for the quarter and six months ended June 30, 2024 in the Company’s Quarterly Report on Form 10-Q and the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, including risk factors disclosed therein, which will be accessible on Aurinia’s website at www.auriniapharma.com, on SEDAR at www.sedarplus.ca or on EDGAR at www.sec.gov/edgar.

Conference Call Details

Aurinia will host a conference call and webcast today, August 1, 2024, at 8:30 AM ET to discuss the quarter and six months ended June 30, 2024, financial results. The link to the audio webcast is available here or on Aurinia’s corporate website at www.auriniapharma.com under "News/Events" through the Investors section. To join the conference call, please dial +1 (866) 682-6100 / +1 (862) 298-0702 (Toll-free U.S. & Canada). A replay of the webcast will be available on Aurinia’s website.

On August 1, 2024 Neurocrine Biosciences, Inc. (Nasdaq: NBIX) reported its financial results for the second quarter ended June 30, 2024 and provided an update on its 2024 financial guidance (Press release, Neurocrine Biosciences, AUG 1, 2024, View Source [SID1234645266]).

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"At Neurocrine, we are energized by the tremendous opportunity we see to help many more patients, and we are encouraged by our recent progress, including INGREZZA’s continued success in treating tardive dyskinesia and Huntington’s disease chorea and the FDA’s decision to grant Priority Review for crinecerfont to treat congenital adrenal hyperplasia," said Kevin Gorman, Ph.D., Chief Executive Officer of Neurocrine Biosciences. "We are in the process of building our endocrinology team and expanding the INGREZZA salesforce, positioning our company for continued strong growth in the years ahead."

Kevin Gorman added, "As I look ahead to my planned retirement in October, I have never been more confident in Neurocrine’s future. I am incredibly proud of all that we have achieved together and excited to see what this team will continue to accomplish for patients under Kyle Gano’s leadership."

Financial Highlights

Three Months Ended

June 30,

Six Months Ended

June 30,

(unaudited, in millions, except per share data)

2024

2023

2024

2023

Revenues:

Net Product Sales

$ 583.8

$ 446.3

$ 1,092.8

$ 861.6

Collaboration Revenue

6.4

6.4

12.7

11.5

Total Revenues

$ 590.2

$ 452.7

$ 1,105.5

$ 873.1

GAAP Research and Development (R&D)

$ 191.1

$ 145.8

$ 350.5

$ 285.3

Non-GAAP R&D

$ 175.3

$ 122.0

$ 317.7

$ 247.7

GAAP Selling, General and Administrative (SG&A)

$ 242.0

$ 221.8

$ 485.1

$ 464.5

Non-GAAP SG&A

$ 200.7

$ 177.1

$ 416.3

$ 393.7

GAAP Net Income

$ 65.0

$ 95.5

$ 108.4

$ 18.9

GAAP Earnings Per Share – Diluted

$ 0.63

$ 0.95

$ 1.04

$ 0.19

Non-GAAP Net Income

$ 168.9

$ 125.7

$ 293.7

$ 76.2

Non-GAAP Earnings Per Share – Diluted

$ 1.63

$ 1.25

$ 2.83

$ 0.76

(unaudited, in millions)

June 30,

2024

December 31,

2023

Total Cash, Cash Equivalents and Marketable Securities

$ 1,676.7

$ 1,719.1

INGREZZA Net Product Sales Highlights

INGREZZA second quarter 2024 net product sales were $580 million and grew 32% compared to the second quarter 2023
Year-over-year growth driven by strong underlying patient demand and improvement in gross-to-net dynamics
Other Key Financial Highlights

Differences in second quarter 2024 GAAP and Non-GAAP operating expenses compared with second quarter 2023 were driven by:
Increased R&D expense in support of an expanded and advancing clinical portfolio including investments in muscarinic compounds, gene therapy programs and second generation VMAT2 inhibitors. R&D expense for the second quarter 2024 includes $27 million for development milestones achieved under our collaborations with Nxera Pharma UK Limited (Nxera, formerly known as Sosei Heptares), Takeda Pharmaceutical Company Limited (Takeda) and Voyager Therapeutics, Inc. (Voyager)
Increased SG&A expense includes incremental investment in crinecerfont-related headcount, crinecerfont-related pre-launch activities, and continued investment in INGREZZA. GAAP SG&A expense also includes impairment charges of $14 million associated with leased office space that has been vacated as we continue to occupy our new campus facility
Second quarter 2024 GAAP net income and earnings per share were $65 million and $0.63, respectively, compared with $96 million and $0.95, respectively, for second quarter 2023
Second quarter 2024 Non-GAAP net income and earnings per share were $169 million and $1.63, respectively, compared with $126 million and $1.25, respectively, for second quarter 2023
Differences in second quarter 2024 GAAP and Non-GAAP net income compared with second quarter 2023 driven by:
Higher INGREZZA net sales and improved operating margin
Second quarter 2024 includes $50 million charge associated with the settlement of convertible senior notes conversions (Non-GAAP adjustment)
Second quarter 2024 includes $20 million loss from changes in fair value of equity security investments compared to $37 million gain the second quarter 2023 (Non-GAAP adjustment)
Second quarter 2024 includes $27 million of development milestones expense achieved under collaborations
Second quarter 2024 includes $14 million leased office space impairment charge (Non-GAAP adjustment)
At June 30, 2024, the Company had cash, cash equivalents and marketable securities totaling approximately $1.7 billion which reflects the $309 million payment to fully retire our convertible senior notes
A reconciliation of GAAP to Non-GAAP financial results can be found in Table 3 and Table 4 at the end of this news release.

Recent Developments

Announced Kevin Gorman, Ph.D., will retire as Chief Executive Officer on October 11, 2024. Kyle Gano, Ph.D., currently Neurocrine’s Chief Business Development and Strategy Officer, will succeed him in the CEO role. Dr. Gano will also join the Company’s Board of Directors at that time, and Dr. Gorman will continue to serve on the Company’s Board.
Announced positive topline data for the Phase 2 SAVITRI study. This randomized, double-blind, placebo-controlled dose-finding study assessed the efficacy and safety of NBI-1065845 in adult subjects with major depressive disorder (MDD). NBI-1065845 is an investigational alpha-amino-3-hydroxy-5-methyl-4-isoxazole propionic acid (AMPA) positive allosteric modulator (PAM) in development as a potential treatment for patients with MDD who have not benefited from treatment with at least one antidepressant in their current episode of depression.
Announced FDA accepted New Drug Applications (NDAs) and granted Priority Review for crinecerfont for adult and pediatric patients with congenital adrenal hyperplasia (CAH). The agency set Prescription Drug User Fee (PDUFA) target actions dates of December 29, 2024 for the capsule formulation and December 30, 2024 for the oral solution formulation.
At the Endocrine Society Annual Meeting (ENDO 2024), presented new Phase 3 clinical study data from the CAHtalyst registrational studies of crinecerfont in pediatric and adult patients with classic congenital adrenal hyperplasia (CAH) due to 21-hydroxylase deficiency. In parallel, announced that the primary study results from the CAHtalyst registrational studies of crinecerfont in pediatric and adult patients with classic congenital adrenal hyperplasia (CAH) due to 21-hydroxylase deficiency have been published in The New England Journal of Medicine.
Initiated Phase 2 study of NBI-1070770 in adults with major depressive disorder. NBI-1070770 is a novel, selective and orally active, negative allosteric modulator (NAM) of the NR2B subunit-containing N-methyl-D-aspartate (NMDA NR2B) receptor.
Initiated Phase 1 study of NBI-1117567 in healthy adult participants. NBI-1117567 is an investigational, oral, M1/M4 (M1 preferring) selective muscarinic agonist for the potential treatment of neurological and neuropsychiatric conditions.
Initiated Phase 1 study of NBI-1076968 in healthy adult participants. NBI-1076968 is an investigational, oral, M4 subtype-selective muscarinic antagonist for the potential treatment of movement disorders.
Received notification from the Centers for Medicare and Medicaid Services that INGREZZA qualified for the Specified Small Manufacturer Exception pertaining to the Part D redesign of the Inflation Reduction Act.
Settled the convertible senior notes due May 15, 2024 in full in cash upon maturity.
Announced planned expansion of the INGREZZA psychiatry and long-term care sales teams to better serve patients by accelerating the number of people who are diagnosed and treated for tardive dyskinesia and chorea associated with Huntington’s disease.
Launched new sprinkle formulation of INGREZZA (valbenazine) capsules for the treatment of adults with tardive dyskinesia and chorea associated with Huntington’s disease.
Raised 2024 Net Sales Guidance and Updated Expense Guidance

Range

(in millions)

Low

High

INGREZZA Net Product Sales 1

$ 2,250

$ 2,300

GAAP R&D Expense 2

$ 665

$ 695

Non-GAAP R&D Expense 3

$ 600

$ 630

GAAP and Non-GAAP IPR&D 4

$ 9

$ 9

GAAP SG&A Expense 5

$ 955

$ 975

Non-GAAP SG&A Expense 3, 5

$ 830

$ 850

1.

INGREZZA sales guidance reflects expected net product sales of INGREZZA in tardive dyskinesia and chorea associated with Huntington’s disease.

2.

GAAP R&D guidance includes $33 million of expense for development milestones in connection with our collaborations (Nxera, Voyager and Takeda) achieved or deemed probable to achieve. These milestone expenses are associated with our advancing pre-clinical and clinical pipeline.

3.

Non-GAAP guidance adjusted to exclude estimated non-cash stock-based compensation expense of approximately $65 million in R&D and $110 million in SG&A and $14 million leased office space impairment charge in SG&A.

4.

Acquired in-process R&D (IPR&D) is included in guidance once significant collaboration and licensing arrangements have been completed.

5.

SG&A guidance range reflects expense for ongoing commercial initiatives supporting INGREZZA growth including the announced planned expansion of the psychiatry and long-term care sales teams and pre-launch commercial activities for crinecerfont.

2024 Pipeline Milestones and Key Activities

Program

Indication

Milestones / Key Activities

NBI-1065845*

(AMPA Potentiator)

Inadequate Response in Major Depressive Disorder

Reported Positive Top-Line Phase 2 Data;

Conducting End of Phase 2 Meeting with FDA; Initiating Phase 3 Studies in 2025

Crinecerfont

(CRF1 Receptor Antagonist)

Congenital Adrenal Hyperplasia

(Pediatric and Adult)

Priority Review with PDUFA Dates Set for December 29 and 30, 2024

NBI-1117568**

(M4 Agonist)

Schizophrenia

Top-Line Phase 2 Data in Q3’24

Luvadaxistat*

(DAAO Inhibitor)

Cognitive Impairment Associated with Schizophrenia

Top-Line Phase 2 Data in Q3’24

NBI-1070770*

(NMDA NR2B NAM)

Major Depressive Disorder

Phase 2 Study Ongoing;

Top-Line Data in 2025

NBI-1065890

(Selective VMAT2 Inhibitor)

CNS Indications

Phase 1 Study Ongoing

NBI-1117569**

(M4-Prefering Agonist)

CNS Indications

Phase 1 Study Ongoing

NBI-1117570**

(M1/M4 Dual Agonist)

CNS Indications

Phase 1 Study Ongoing

NBI-1117567**

(M1 Agonist)

CNS Indications

Phase 1 Study Ongoing

NBI-1076986

(M4 Antagonist)

Movement Disorders

Phase 1 Study Ongoing

Key: AMPA = alpha-amino-3-hydroxy-5-methyl-4-isoxazole propionic acid; CFR1 = Corticotropin-Releasing Factor Type 1; M4 = M4 Muscarinic Receptor; DAAO = d-amino acid oxidase; NMDA NR2B NAM = n-methyl-d-aspartate Receptor Subtype 2B Negative Allosteric Modulator; VMAT2 = Vesicular Monoamine Transporter 2; M1 = M1 Muscarinic Receptor

Neurocrine Biosciences Partners: * Partnered with Takeda Pharmaceutical Company Limited; ** In-Licensed from Nxera Pharma UK Limited (formerly Sosei Heptares)

Conference Call and Webcast Today at 8:00 AM Eastern Time
Neurocrine Biosciences will hold a live conference call and webcast today at 8:00 a.m. Eastern Time (5:00 a.m. Pacific Time). Participants can access the live conference call by dialing 800-445-7795 (US) or 785-424-1699 (International) using the conference ID: NBIX. The webcast and accompanying slides can also be accessed at approximately 8:00 a.m. Eastern Time on Neurocrine Biosciences’ website under Investors at www.neurocrine.com. A replay of the webcast will be available on the website approximately one hour after the conclusion of the event and will be archived for approximately one month.

On August 1, 2024 BostonGene, a leading provider of artificial intelligence (AI)-driven molecular and immune profiling solutions, reported that it will collaborate with Takeda on immuno-oncology focused research studies (Press release, BostonGene, AUG 1, 2024, View Source [SID1234645284]). This partnership aims to identify key molecular drivers and predictive markers for treatment efficacy and adverse effects with the primary goal of advancing clinical solutions and improving patient outcomes.

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Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

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Takeda will leverage BostonGene’s AI-powered multiomics platform in select early-stage clinical trials to enhance trial design, improve indication selection and identify biomarker signatures for response and toxicity. BostonGene will perform sophisticated multiomic analytics using proprietary computational platforms on clinical and laboratory data provided by Takeda. Additionally, BostonGene will conduct extensive bioinformatics analysis on flow cytometry, RNA-seq and proteomics data.

"We are pleased to enter this partnership with BostonGene, which will enable us to leverage cutting-edge technology to advance our oncology research and development," said PK Morrow, MD, Head, Oncology Therapeutic Area Unit at Takeda. "Through this collaboration we look forward to utilizing data and AI to gain more insights into the biology and mechanisms of investigational therapies at the earliest stages. These data will help us to better understand their potential in certain patient populations and ultimately help advance oncology medicines for patients who need them."

"BostonGene is excited to collaborate with Takeda," said Nathan Fowler, MD, Chief Medical Officer at BostonGene. "Our advanced multiomic analytics will significantly improve patient selection processes and pinpoint critical mechanistic signatures associated with response, driving forward the development of innovative treatments."

On August 1, 2024 Biogen Inc. (NASDAQ: BIIB) reported second quarter 2024 financial results (Press release, Biogen, AUG 1, 2024, View Source [SID1234645248]). Commenting on the quarter, President and Chief Executive Officer Christopher A. Viehbacher said:

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"Biogen delivered strong financial performance in the second quarter thanks to solid execution against our business strategy, which is aimed at transforming the Company to deliver sustainable growth. We saw continued positive momentum across new product launches and are pleased with the trends we see with key products going into the third quarter. We believe we have created a strong mid- to late-stage development pipeline thanks to reprioritization efforts made last year and key acquisitions like HI-Bio, which was announced in the quarter. Our Fit for Growth program announced in early 2023 continues to deliver significant savings, allowing us to strategically reinvest a portion back into product launches and the pipeline."
Financial Highlights
Q2 ’24 Q2 ’23 △
r (CC*)
Total Revenue (in millions) $2,465 $2,456 0% 1%
GAAP diluted EPS $4.00 $4.07 (2)% —%
Non-GAAP diluted EPS $5.28 $4.02 31% —%

Note: Percent changes represented as favorable/(unfavorable) versus the prior year period.
* Percentage changes in revenue growth at constant currency (CC) are presented excluding the impact of changes in foreign currency exchange rates and hedging gains or losses. Foreign currency revenue values are converted into U.S. Dollars using the exchange rates from the end of the previous calendar year.

A reconciliation of GAAP to Non-GAAP financial measures can be found in Table 4 at the end of this news release.
Revenue Summary
(in millions) Q2 ’24 Q2 ’23 △
r (CC*)
Multiple sclerosis (MS) product revenue(1)
$1,150 $1,209 (5)% (5)%
Rare disease revenue(2)
$534 $438 22% 25%
Biosimilars revenue $198 $195 2% 1%
Other product revenue(3)
$18 $3 431% 441%
Total product revenue $1,900 $1,846 3% 4%
Revenue from anti-CD20 therapeutic programs $445 $433 3% 3%
Contract manufacturing, royalty and other revenue $121 $177 (32)% (32)%
Total revenue $2,465 $2,456 0% 1%

Note: Percent changes represented as favorable/(unfavorable) versus the prior year period. Numbers may not foot or recalculate due to rounding.
(1) Multiple sclerosis includes TECFIDERA, VUMERITY, AVONEX, PLEGRIDY, TYSABRI and FAMPYRA.
(2) Rare disease includes SPINRAZA, SKYCLARYSand QALSODY.
(3) Other includes ADUHELM, FUMADERM and ZURZUVAE.
•Second quarter 2024 ZURZUVAE revenue was approximately $15 million.
Expense Summary
(in millions) Q2 ’24 Q2 ’23 △
GAAP cost of sales*
$546 $593 8%
% of Total Revenue 22% 24%
Non-GAAP cost of sales*
$504 $593 15%
% of Total Revenue 20% 24%
GAAP R&D expense $514 $584 12%
Non-GAAP R&D expense $464 $584 21%
GAAP SG&A expense $554 $548 (1)%
Non-GAAP SG&A expense $542 $534 (1)%

Note: Percent changes represented as favorable/(unfavorable) versus the prior year period
* Excluding amortization and impairment of acquired intangible assets

•There were no idle capacity charges in the second quarter of 2024. Second quarter 2023 GAAP and Non-GAAP cost of sales includes approximately $34 million of idle capacity charges. The decrease in second quarter 2024 GAAP and Non-GAAP cost of sales as a percentage of total revenue was driven primarily by product mix, particularly the year-over-year increase in revenue from new product launches and decrease in contract manufacturing revenue, as well as less idle capacity charges.

•In the second quarter 2024 as compared to the second quarter of 2023, the decrease in GAAP and Non-GAAP R&D of approximately $70 million and $120 million, respectively, was primarily due to savings achieved from the Company’s R&D portfolio prioritization and Fit for Growth initiatives.

•In the second quarter 2024 as compared to the second quarter of 2023, the increase in GAAP and Non-GAAP SG&A expense of approximately $6 million and $8 million, respectively, was primarily due to increased commercialization spend related to new product launches, partially offset by savings achieved from the Company’s Fit for Growth initiative.
Other Financial Highlights

•Second quarter 2024 GAAP and Non-GAAP collaboration profit sharing was a net expense of $62 million, which includes $56 million related to Biogen’s collaboration with Samsung Bioepis, and $6 million to Sage Therapeutics related to the commercialization of ZURZUVAE in the U.S.

•Second quarter 2024 GAAP and Non-GAAP priority review voucher gain on sale, net was approximately $89 million.

•Second quarter 2024 GAAP other expense was $85 million, primarily driven by net interest expense and net unrealized losses on strategic equity investments of $30 million. Second quarter 2024 Non-GAAP other expense was $55 million, primarily driven by net interest expense.

•Second quarter 2024 GAAP and Non-GAAP effective tax rates were 16.5% and 15.9%, respectively. Second quarter 2023 GAAP and Non-GAAP effective tax rates were 16.2% and 15.7%, respectively.
Financial Position

•Second quarter 2024 net cash flow from operations was $626 million. Capital expenditures were $34 million, and free cash flow, defined as net cash flow from operations less capital expenditures, was $592 million.

•As of June 30, 2024, Biogen had cash, cash equivalents, and marketable securities totaling approximately $1.9 billion and approximately $6.3 billion in total debt, resulting in net debt of approximately $4.4 billion. Subsequent to the end of the quarter, Biogen utilized $1.15 billion of cash to acquire HI-Bio, which is not included in these figures.

•As of June 30, 2024, the $1.0 billion 2023 Term Loan which was put in place at the time of the Reata acquisition has been repaid.

•No shares of the Company’s common stock were repurchased in the second quarter of 2024. As of June 30, 2024, there was $2.1 billion remaining under the share repurchase program authorized in October 2020.

•For the second quarter of 2024 the Company’s weighted average diluted shares were 146 million.

Full Year 2024 Financial Guidance

For the full year 2024, Biogen now expects a Non-GAAP diluted EPS guidance range as follows:
Prior FY 2024 Guidance Updated FY 2024 Guidance
Non-GAAP diluted EPS
$15.00 to $16.00
Reflecting growth of ~5% at the mid-point*
$15.75 to $16.25
Reflecting growth of ~9% at the mid-point*

*Versus reported full year 2023

Biogen now expects total revenue to decline by a low-single digit percentage (previously low to mid-single percentage), with core pharmaceutical revenue, defined as product revenue plus Biogen’s 50% share of net LEQEMBI product revenue and cost of sales, including royalties, to be relatively flat for 2024 compared to 2023 as further declines in multiple sclerosis product revenue are expected to be offset by increases in revenue from new product launches.

Biogen continues to expect an improvement in the cost of sales as a percentage of total revenue for 2024 compared to 2023 driven by product mix and significantly lower idle capacity charges.

Biogen expects to reinvest the proceeds from the sale of one of the Company’s two priority review vouchers in growth initiatives in 2024.

For 2024 compared to 2023, Biogen now expects operating income to grow at a mid- to high-teen percentage with mid-single digit percentage point operating margin improvement. This is expected to be driven by improved cost of sales as a percentage of revenue, as well as lower operating expenses as a result of the Company’s Fit for Growth and R&D prioritization programs.

This financial guidance does not include any impact from potential acquisitions or large business development transactions or pending and future litigation, as all are hard to predict, or any impact of potential tax or healthcare reform. Biogen may incur charges, realize gains or losses, or experience other events or circumstances in 2024 that could cause any of these assumptions to change and/or actual results to vary from this financial guidance.

This guidance also assumes that foreign exchange rates as of July 26, 2024, will remain in effect for the remainder of the year, net of hedging activities. Other modeling considerations will be provided on the conference call and webcast.

Biogen does not provide guidance for GAAP reported financial measures (other than revenue) or a reconciliation of forward-looking Non-GAAP financial measures to the most directly comparable GAAP reported financial measures because the Company is unable to predict with reasonable certainty the financial impact of items such as the transaction, integration, and certain other costs related to acquisitions or large business development transactions; unusual gains and losses; potential future asset impairments; gains and losses from our equity security investments; and the ultimate outcome of pending or future significant litigation without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on GAAP reported results for the guidance period. For the same reasons, the Company is unable to address the significance of the unavailable information, which could be material to future results.

Key Recent Events

•Today Biogen announced the termination of the Antibody Transport Vehicle (ATV): Amyloid beta program (ATV:Aβ) with Denali Therapeutics.

The Company’s earnings conference call for the second quarter will be broadcast via the internet at 8:30 a.m. ET on August 1, 2024 and will be accessible through the Investors section of Biogen’s website, www.biogen.com. Supplemental information in the form of a slide presentation is also accessible at the same location on the internet and will be subsequently available on the website for at least 90 days.